Domestic Heating

Potential annual savings (from switching electric to gas): $1550

 (Based on 1500 sq ft house; Electric heat estimated at 24,000kWh per year @ $0.10/kWh = $2400; Gas, Forced Air at 122,000 Megajoules per year @ $0.007/MJ = $850)

 Fuel Choice

 The two most common heating systems are forced air (67% of Canadian homes), ½ fuelled by gas, and electric baseboards (18% of homes).

 Electricity is the most expensive heat money can buy. The reason houses have electric baseboard heat is simply because it is very cheap to install. If you have electric baseboards, there is little you can do to save money beyond making sure that your insulation and draft-proofing are as good as possible.

 Apart from that, install a warm air system with ducts, or a water heating system with small bore plumbing and radiators. The latter is less intrusive and probably cheaper to install. The former allows you to add central air conditioning. If you can afford to switch from electric baseboards, your heating bills should drop by 50%-75%! The cost of the conversion ($5000 – $7000) should be recovered in ~3 years!

 Old houses dating back to WWII or before may still have a old coal furnace which was converted to oil, and possibly a 2nd time to gas. This type of furnace, often made of cast iron, is immortal and diabolically inefficient. Throw it out! Replace it with a modern unit -you will go from about 50% efficiency to 80% or even 95% depending on your choice.

 Houses 30-40 years old are likely to have a furnace with an efficiency rating below 75%. A 20-year-old unit may be less efficient now than its nameplate suggests. Since a new hot air furnace will cost at least $2000, plus installation, you need to estimate whether heating costs you enough to justify a change. A new furnace will be at least 80% efficient. If your heating bills are $1500 for the year and your old furnace is 60% efficient, an 80% unit may cost $2500. Your heating bills will drop by 80/60 (1.33), so your new heating bill will drop to $1100, saving $400 per year. Your savings will pay for your new furnace in ~6 years.

 If you install a high efficiency 94% furnace, your heating bill will drop by 94/60 (1.57), or $540 per year. The high-efficiency furnace might cost $4000, taking 7.5 years to pay off.

 Insulation and draft proofing always make economic sense. Buying a new furnace to replace a working unit may not. Unless your furnace is over 15 years old, it may be best to wait until it needs replacement. The above estimates simply show you how to calculate the savings and help you decide.


 If available, gas heat is usually the best choice. Besides being relatively environmentally benign, gas units are generally cheaper to buy and to operate than oil or wood furnaces, or heat pumps.


 If you do not have access to natural gas, your choices are between propane, oil, or electric heat pump. If you like feeding a fire and forestry, you can go for wood heat, but this is rarely automatic and needs frequent feeding. Wood is also fairly polluting. On the other hand, depending on where you live, wood heat can be cheap. If you do opt for wood, make sure that your heating appliance has a fresh air feed – preferably right to the firebox – and does not depend on air sneaking under doors and window frames.


 Propane is very similar to natural gas. Unfortunately, it is about 3 times the price of natural gas, but probably close to oil. The advantage of propane is that it will burn in the same appliances as natural gas. So if you chose propane and natural gas does come to your area, converting your furnace, stove or water heater will be a simple matter of changing the burner jets and minor adjustments to the air supply.


 Oil is convenient and widely available. Not very flammable, fuel oil is safe to store – old houses may have tanks in a basement. By comparison, large propane tanks must be kept some distance from a dwelling. Furnaces using oil tend to have slightly lower efficiencies than the best gas units, and the cost of fuel oil varies with the world petroleum price.

 Heat Pump

 The electric heat pump is basically a large version of the device in your refrigerator or air conditioner. A special pump compresses a gas, liquefying it. As the gas condenses to a liquid, heat is released – the same amount of heat that is absorbed when the liquid evaporates, cooling its surroundings.

 When the heat pump is used for heating, the condenser (warm) coils are inside the house and the evaporator (cool) coils outside. The energy to move the heat comes from the electricity consumed by the motor.

 Because the electricity is not actually producing the heat – simply pumping it “uphill” from a cool place to a warmer one – a heat pump can actually put up to 4 times as much heat into your house as you could get from a baseboard heater.

 Heat pumps are rated by a coefficient of performance (COP). A heat pump delivering 3000 watts of heat, but using 1000 watts has a COP of 3. As the temperature drops, so does the COP. Below freezing, COP approaches one. In other words, a heat pump may be no better than a baseboard heater when you need it most (but see below)!

 eat pumps are good when you also want central air conditioning. The same machinery will both provide heat in winter, and cool in summer.

 Improving the Heat Pump – “Ground Source”

 The heat pump can be improved. This is done by burying the heat exchanger below ground, where soil temperature varies from 5oC to 15oC. This is called a ground source (sometimes labeled geothermal) heat pump.

 In winter the heat pump moves heat from 5-10oC soil into the house at 20oC, and in summer it pumps heat from the house at 25oC to soil at 15-20oC. (Soil is cooler in winter and warmer in summer. Also, the heat exchanger affects local soil temperature.) By contrast, an air-to-air heat exchanger must move heat from – 10oC winter air into the house at 20oC, and in summer from a house at 25oC to air at 30oC. The COP of a ground source heat pump is better than one with an air-to-air heat exchanger at extreme temperatures.

 The operating cost for an electrically powered ground source heat pump is quite competitive with that of a gas-fuelled furnace. And, there is no extra charge for air conditioning! Of course, the cost of installation is considerably higher than an air-to-air unit due to the digging required.

Domestic Heating